Question

U
LOUILO
Q.NO.59:Find the future value of an annuity of Rs.500
made annually for 7 years at interest rate of 14%
compounded annually. Given that (1.14) = 2.5023.​

Answer 1

Answer:

5365.24

Step-by-step explanation:

500/0.14. {(1+0.14)^7-1}

Answer 2

Given,

Annual amount = Rs. 500

Time = 7 years

The rate of interest = 14%

To Find,

The future value of a given amount =?

Solution,

From the formula future value, we have

$A(7,0.14) = A [(1 + 0.14)^7 - 1 / 0.14]\\A(7,0.14) = 500 [(1.14^7 - 1 / 0.14]\\A(7,0.14) = 500 [2.5 - 1 / 0.14]\\A(7,0.14) = 500 [1.5/ 0.14]\\A(7,0.14) = 5365.35$

Hence, the future value of an annuity of Rs.500 made annually for 7 years at an interest rate of 14% compounded annually will be Rs. 5365.3